Friday, October 31, 2008

What recession?

What recession?

In Canada there is not a recession.

The technical definition of a recession is two successive quarters of negative growth. Growth has slowed but it is not yet negative in Canada.

We read every day about the swings of the stock market. However that is only an indication of the confidence in public companies. And the stock market is fueled by greed and fear. Hardly a smart way to run a business or an economy.

According to my radio show guest, Catherine Swift, CEO of the Canadian Federation of Independent Business - over 50% of the Canadian economy is generated by privately held business. A significant portion of that is businesses with five to ten employees.

According to the CFIB's weekly survey of it's more than 100,000 members - business owners are holding pat. They are not laying off staff. They believe the light is within the near future.

Privately held companies are less likely to sway to public pressure. The owners are more likely to make good business decisions for the longer term.

CEOs of publicly traded companies are at the whim of shareholders who are fickle. These CEOs sometimes need to be more political than politicians. Because of that they might make decisions that do not help the company nor the community but simply improve the next quarter earnings and hence their bonus.

If you really want to know what is going on in business - don't read the papers or watch the mainstream news - have coffee with a small business owner.

George Torok
Host of Business in Motion
Canadian Business Speaker
Canadian Motivational Speaker

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